This Tax Code Can Give You a Huge Advantage

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This Tax Code Can Give You a Huge Advantage

By Charles Mizrahi, Founder, Alpha Investor

Dear American Investor,

You might not know it, but you have a partner.

He doesn’t get involved in your business or interfere with your decision-making.

In fact, he couldn’t care less … as long as what you do is legal.

At the end of every year, you have to answer to him — even if you’re self-employed. 

He comes calling for his share of your profits. 

Like it or not, the U.S. government is your partner. And it demands up to 37% of your income each year.

I don’t know about you, but paying taxes doesn’t put a smile on my face.

Like most Americans, I use the tax code to pay my fair share and not a penny more.

And many of the people I know are people of means.

They have teams of accountants and lawyers on retainer who know the tax codes better than they know their kids’ birthdays.

At the end of the day, many of them pay lower tax rates than their secretaries. But I don’t begrudge them. 

In fact, I admire them. They know how to work the system while still playing by the rules.

That’s why I want to share with you a very simple, easy and legal way to put more money in your pocket instead of Uncle Sam’s… 

Circle Your Calendar

It’s a “hack” used every day by people in the know. 

And all you need to do is buy a calendar that has more than 12 months.  

Start by marking down the day you bought a stock. 

Next, circle the same day one year later.

And then, make an X on the day after. 

For example, if you buy a stock on April 12, 2022, you’ll circle April 12, 2023.

Then, you make an X on the following day, April 13, 2023.

If you want to sell the stock — and it shows a profit — make sure you don’t sell it before April 13, 2023.

With this simple hack, you used U.S. Code Title 26, Section 1222 on capital gains taxes to your advantage.

And that advantage can be a huge one…

Bigger Pockets

Let’s say you bought $10,000 worth of shares in a quality business in 1992.

And over the next 30 years, the business did great and the stock climbed. In fact, its stock grew at a rate of 15% per year.

So, in 2022, you decide to sell your shares. 

Taking the 20% long-term capital gains tax rate into account, your $10,000 would’ve grown to over $531,000.

But let’s say that instead of holding on, you traded the stock — buying and selling it every year — and still made the same 15% annual return. 

Instead of paying a one-time tax, you’d have to pay a 37% short-term capital gains tax at the end of each year.

Your $10,000 investment would’ve grown to only about $150,000.

By using the long-term capital gains tax to your advantage, you would have walked away with more than $380,000 in your pocket!

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The bottom line here is: It actually pays to be patient…

How Paul Mampilly Personally Invests His Money

If you’ve ever wanted to know what kinds of stocks Paul likes to buy in his personal portfolio … now you can. For the inside track on Paul’s “secret portfolio,” click here.

Your Advantage

Trading will only end up taking a big chunk out of your gains and putting them in the IRS’ coffers.

But by sitting on your hands and doing nothing, you can make a boatload more money.

As Charlie Munger once said:

“The tax code gives you an enormous advantage if you can find some things you can just sit with.”

All you have to do is buy a quality company when it trades at an attractive price and then sit back, relax and let your tax dollars compound for you. 

Nothing more complicated than that.

So, if you’re looking at selling winners before Tax Day, keep this in mind…

Use the IRS’ tax code to your advantage over the long term.

And if you really want to turbocharge these gains, the Alpha Investor Approach can put even more money back in your pocket.

If you’re already part of the family, you can check out our model portfolio to see which stocks are trading below their buy-up-to prices.

These stocks — including my latest recommendation — are still trading at attractive prices today. If you’re underinvested, now’s the time to buy more shares if you haven’t already.

But if you’re not part of the family yet, it’s not too late! 

You can find out how to join over 100,000 Main Street investors just like you in accessing these market opportunities. Find out how right here.


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Charles Mizrahi
Founder, Alpha Investor

P.S. I also recently shared some of these Tax Day insights and many more in my book, Wall Street Profits for Main Street Investors.

If you haven’t grabbed your copy yet, you can do so right here.

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